ATLANTA, Nov. 1, 2012 (GLOBE NEWSWIRE) -- BlueLinx Holdings Inc. BXC, a leading distributor of building products in North America, today reported financial results for the third quarter ended September 29, 2012.
The Company reported net income of $3.1 million, or $0.05 per diluted share for the third quarter of 2012, compared to a net loss of $6.2 million, or $0.12 per diluted share, for the third quarter of 2011. Revenues for the third quarter were $496.8 million, up 5.1% from $472.9 million for the third quarter of 2011.
Gross profit for the third quarter totaled $60.5 million, up 3.9% from $58.3 million in the year-ago period. Gross margins of 12.2%, compared to 12.3% a year ago, remained strong as a result of the Company's ongoing initiatives to increase margins across all product categories combined with increases in underlying wood-based product prices and a shift to the warehouse distribution channel from the direct and reload distribution channels.
Third-quarter operating expenses of $50.3 million were down compared to $57.1 million for the same period a year ago, and included $9.2 million or $0.09 per diluted share and $2.1 million or $0.02 per diluted share in net gains from significant special items in 2012 and 2011 respectively. Reported operating profit for the quarter was $10.3 million, compared to an operating profit of $1.2 million a year ago.
George Judd, President and Chief Executive Officer of BlueLinx stated, "We are pleased to report third-quarter net income for BlueLinx. Looking forward, we have increased optimism that our business will continue to improve as general economic factors and leading indicators for our business point to improving market conditions and we continue to execute our strategy."
For the nine months ended September 29, 2012, net loss totaled $11.7 million, or $0.19 per diluted share, compared with $28.3 million, or $0.75 per diluted share, a year ago. Revenues for the nine months totaled $1.47 billion, up 7.6% from $1.36 billion the same period a year ago. Gross profit for the nine months ended September 29, 2012 totaled $178.0 million and gross margin was 12.1%, compared with $162.2 million and 11.9% a year earlier. Total operating expenses of $167.9 million were flat compared to a year ago, and included $10.2 million or $0.10 per diluted share and $8.8 million or $0.14 per diluted share in net gains from significant special items in 2012 and 2011 respectively.
The Company's operating results for the 2012 and 2011 third quarter and year-to-date periods, adjusted for significant special items, are shown in the following table (see accompanying financial schedules for full financial details and reconciliations of non-GAAP financial measures to their GAAP equivalents):
| in millions, except per share amounts | ||||
| (unaudited) | Quarters Ended | Nine Months Ended | ||
| September 29, 2012 | October 1, 2011 | September 29, 2012 | October 1, 2011 | |
| Pretax income (loss) | $3.0 | ($6.1) | ($11.3) | ($28.2) |
| Gain from sale of certain properties | (9.2) | -- | (9.7) | (6.9) |
| Gain on modification of lease agreement | -- | (2.0) | -- | (2.0) |
| Gain from property insurance settlement | -- | (1.2) | (0.5) | (1.2) |
| Severance related costs | -- | 1.1 | -- | 1.3 |
| Adjusted pretax loss before the effect of special interest items | (6.2) | (8.2) | (21.5) | (37.0) |
| Changes associated with the ineffective interest rate swap | -- | -- | -- | (1.7) |
| Adjusted pretax loss | (6.2) | (8.2) | (21.5) | (38.7) |
| Adjusted benefit from income taxes | (2.5) | (3.1) | (8.0) | (14.8) |
| Adjusted net loss | ($3.7) | ($5.1) | ($13.5) | ($23.9) |
| Basic weighted average shares* | 60.1 | 51.2 | 60.1 | 37.7 |
| Adjusted basic net loss per share applicable to common shares | ($0.06) | ($0.10) | ($0.23) | ($0.63) |
| Diluted weighted average shares* | 60.1 | 51.2 | 60.1 | 37.7 |
| Adjusted diluted net loss per share applicable to common shares | ($0.06) | ($0.10) | ($0.23) | ($0.63) |
| * The increase in basic and diluted weighted average shares primarily results from the issuance of 28.6 million shares as a result of the July 29, 2011 rights offering. | ||||
For the quarter and year-to-date periods ended September 29, 2012, the above table reflects the following events; (i) the Company recorded a gain on the sale of certain properties; and (ii) the Company recorded a gain from a property insurance settlement. The adjusted benefit from income taxes reflected in the table is comprised of the Company's effective tax rate excluding the valuation allowance related to its deferred tax assets and the tax effect of significant special items. The adjusted benefit from income taxes assumes the Company's deferred tax assets are realizable.
For the quarter and year-to-date periods ended October 1, 2011, the above table reflects the following events: (i) the Company recorded a gain on the sale of certain properties during the first quarter of 2011; (ii) the Company recorded a gain on the modification of a lease agreement; (iii) the Company recorded a gain from a property insurance settlement; (iv) the Company recorded certain severance costs; and (v) the Company recorded the effect of a reduction in the fair value of its terminated ineffective interest rate swap partially offset by the continued amortization of the accumulated other comprehensive loss related to the ineffective interest rate swap into interest expense. The adjusted benefit from income taxes reflected in the table is comprised of the Company's effective tax rate excluding the valuation allowance related to its deferred tax assets, a tax benefit related to our intra period income tax allocation to other comprehensive income and the tax effect of significant special items. The adjusted benefit from income taxes assumes the Company's deferred tax assets are realizable.
Conference Call
BlueLinx will host a conference call today at 10:00 a.m. Eastern Time, accompanied by a supporting slide presentation. Investors can listen to the conference call and view the accompanying slide presentation by going to the BlueLinx web site, www.BlueLinxCo.com, and selecting the conference link on the Investor Relations page. Investors will be able to access an archived recording of the conference call for one week by calling 404-537-3406, Conference ID# 48164994. The recording will be available two hours after the conference call has concluded. Investors also can access a recording of this call on the BlueLinx web site, where a replay of the webcast will be available for 90 days.
Use of Non-GAAP Measures
BlueLinx reports its financial results in accordance with U.S. generally accepted accounting principles (GAAP). The Company also believes that presentation of certain non-GAAP measures, i.e., results excluding certain charges or other nonrecurring events, when appropriate, provides useful information for the understanding of its ongoing operations and enables investors to focus on period-over-period operating performance, without the impact of significant special items, and thereby enhances the user's overall understanding of the Company's current financial performance relative to past performance and provides a better baseline for modeling future earnings expectations. Any non-GAAP measures used herein are reconciled in the financial tables accompanying this news release. The Company cautions that non-GAAP measures should be considered in addition to, but not as a substitute for, the Company's reported GAAP results.
About BlueLinx Holdings Inc.
Headquartered in Atlanta, Georgia, BlueLinx Holdings Inc., operating through its wholly owned subsidiary BlueLinx Corporation, is a leading distributor of building products in North America. Employing approximately 1,900 people, BlueLinx offers greater than 10,000 products from over 750 suppliers to service approximately 11,500 customers nationwide, including dealers, industrial manufacturers, manufactured housing producers and home improvement retailers. The Company operates its distribution business from sales centers in Atlanta and Denver, and its network of approximately 55 distribution centers. BlueLinx is traded on the New York Stock Exchange under the symbol BXC. Additional information about BlueLinx can be found on its Web site at www.BlueLinxCo.com.
Forward-looking Statements
This press release includes "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, including statements relating to our ability to return to profitability and our outlook on the housing industry. All of these forward-looking statements are based on estimates and assumptions made by our management that, although believed by BlueLinx to be reasonable, are inherently uncertain. Forward-looking statements involve risks and uncertainties, including, but not limited to, economic, competitive, governmental and technological factors outside of BlueLinx' control that may cause its business, strategy or actual results to differ materially from the forward-looking statements. These risks and uncertainties may include, among other things: changes in the supply and/or demand for products that it distributes, especially as a result of conditions in the residential housing market; general economic and business conditions in the United States; the activities of competitors; changes in significant operating expenses; changes in the availability of capital, including the availability of residential mortgages; the ability to identify acquisition opportunities and effectively and cost-efficiently integrate acquisitions; adverse weather patterns or conditions; acts of war or terrorist activities; variations in the performance of the financial markets; and other factors described in the "Risk Factors" section in the Company's Annual Report on Form 10-K for the year ended December 31, 2011 and in its periodic reports filed with the Securities and Exchange Commission from time to time. Given these risks and uncertainties, you are cautioned not to place undue reliance on forward-looking statements. BlueLinx undertakes no obligation to publicly update or revise any forward-looking statement as a result of new information, future events, changes in expectation or otherwise, except as required by law.
- Tables to Follow -
| BlueLinx Holdings Inc. | ||||
| Statements of Operations | ||||
| in thousands, except per share data | ||||
| Quarters Ended | Nine Months Ended | |||
| September 29, 2012 | October 1, 2011 | September 29, 2012 | October 1, 2011 | |
| (unaudited) | (unaudited) | (unaudited) | (unaudited) | |
| Net sales | $ 496,810 | $ 472,898 | $ 1,467,544 | $ 1,364,313 |
| Cost of sales | 436,279 | 414,620 | 1,289,593 | 1,202,121 |
| Gross profit | 60,531 | 58,278 | 177,951 | 162,192 |
| Operating expenses: | ||||
| Selling, general, and administrative | 48,156 | 54,537 | 161,358 | 159,760 |
| Depreciation and amortization | 2,106 | 2,559 | 6,553 | 8,120 |
| Total operating expenses | 50,262 | 57,096 | 167,911 | 167,880 |
| Operating income (loss) | 10,269 | 1,182 | 10,040 | (5,688) |
| Non-operating expenses: | ||||
| Interest expense | 7,294 | 6,963 | 21,401 | 23,754 |
| Changes associated with the ineffective interest rate swap, net | -- | -- | -- | (1,751) |
| Other (income) expense, net | (16) | 333 | (29) | 485 |
| Income (loss) before (benefit from) provision for income taxes | 2,991 | (6,114) | (11,332) | (28,176) |
| (Benefit from) provision for income taxes | (77) | 94 | 325 | 139 |
| Net income (loss) | $ 3,068 | $ (6,208) | $ (11,657) | $ (28,315) |
| Basic weighted average number of common shares outstanding | 60,099 | 51,183 | 60,067 | 37,696 |
| Basic net income (loss) per share applicable to common shares | $ 0.05 | $ (0.12) | $ (0.19) | $ (0.75) |
| Diluted weighted average number of common shares outstanding | 60,099 | 51,183 | 60,067 | 37,696 |
| Diluted net income (loss) per share applicable to common shares | $ 0.05 | $ (0.12) | $ (0.19) | $ (0.75) |
| BlueLinx Holdings Inc. | ||
| Balance Sheets | ||
| in thousands | ||
| September 29, 2012 | December 31, 2011 | |
| (unaudited) | ||
| Assets: | ||
| Current assets: | ||
| Cash and cash equivalents | $ 7,874 | $ 4,898 |
| Receivables, net | 191,740 | 138,872 |
| Inventories, net | 220,252 | 185,577 |
| Other current assets | 45,138 | 27,141 |
| Total current assets | 465,004 | 356,488 |
| Property, plant, and equipment: | ||
| Land and land improvements | 43,058 | 49,562 |
| Buildings | 94,070 | 95,652 |
| Machinery and equipment | 75,715 | 75,508 |
| Construction in progress | 1,036 | 741 |
| Property, plant, and equipment, at cost | 213,879 | 221,463 |
| Accumulated depreciation | (102,413) | (98,335) |
| Property, plant, and equipment, net | 111,466 | 123,128 |
| Non-current deferred income tax assets, net | 382 | 358 |
| Other non-current assets | 18,569 | 23,941 |
| Total assets | $ 595,421 | $ 503,915 |
| Liabilities: | ||
| Current liabilities: | ||
| Accounts payable | $ 81,576 | $ 70,228 |
| Bank overdrafts | 31,892 | 22,364 |
| Accrued compensation | 5,799 | 4,496 |
| Current maturities of long-term debt | 69,505 | 9,046 |
| Deferred income taxes, net | 382 | 382 |
| Other current liabilities | 11,844 | 16,558 |
| Total current liabilities | 200,998 | 123,074 |
| Noncurrent liabilities: | ||
| Long-term debt | 350,615 | 328,695 |
| Other non-current liabilities | 45,378 | 43,772 |
| Total liabilities | 596,991 | 495,541 |
| Stockholders' (Deficit) Equity: | ||
| Common stock | 637 | 620 |
| Additional paid-in capital | 209,114 | 207,626 |
| Accumulated other comprehensive loss | (21,689) | (21,900) |
| Accumulated deficit | (189,632) | (177,972) |
| Total stockholders' (deficit) equity | (1,570) | 8,374 |
| Total liabilities and stockholders' (deficit) equity | $ 595,421 | $ 503,915 |
| BlueLinx Holdings Inc. | ||
| Statements of Cash Flows | ||
| in thousands | ||
| Nine Months Ended | ||
| September 29, 2012 | October 1, 2011 | |
| (unaudited) | (unaudited) | |
| Cash flows from operating activities: | ||
| Net loss | $ (11,657) | $ (28,315) |
| Adjustments to reconcile net loss to cash used in operations: | ||
| Depreciation and amortization | 6,553 | 8,120 |
| Amortization of debt issuance costs | 2,799 | 2,029 |
| Gain from sale of properties | (9,680) | (6,939) |
| Gain from property insurance settlement | (476) | (1,230) |
| Changes associated with the ineffective interest rate swap | -- | (1,751) |
| Vacant property charges, net | (30) | -- |
| Gain on modification of lease agreement | -- | (1,971) |
| Payments on modification on lease agreement | (5,875) | -- |
| Deferred income tax benefit | (24) | (282) |
| Share-based compensation expense | 2,097 | 1,578 |
| (Increase) decrease in restricted cash related to the swap, insurance, and other | (123) | 443 |
| Changes in assets and liabilities: | ||
| Receivables | (52,868) | (65,535) |
| Inventories | (34,675) | (15,527) |
| Accounts payable | 12,776 | 26,641 |
| Changes in other working capital | 2,859 | 1,365 |
| Other | 1,650 | (2,439) |
| Net cash used in operating activities | (86,674) | (83,813) |
| Cash flows from investing activities: | ||
| Property, plant, and equipment investments | (2,490) | (5,767) |
| Proceeds from disposition of assets | 18,561 | 8,994 |
| Net cash provided by investing activities | 16,071 | 3,227 |
| Cash flows from financing activities: | ||
| Repurchase of shares to satisfy employee tax withholdings | (446) | -- |
| Repayments on the revolving credit facilities | (345,674) | (348,877) |
| Borrowings from the revolving credit facilities | 436,374 | 370,112 |
| Payment of principal on mortgage | (8,370) | (38,724) |
| Payments on capital lease obligations | (604) | (1,224) |
| Increase in bank overdrafts | 9,528 | 7,233 |
| (Increase) decrease in restricted cash related to the mortgage | (15,546) | 27,724 |
| Debt financing costs | (1,683) | (2,647) |
| Proceeds from stock offering less expenses paid | -- | 58,582 |
| Net cash provided by financing activities | 73,579 | 72,179 |
| Increase (decrease) in cash | 2,976 | (8,407) |
| Balance, beginning of period | 4,898 | 14,297 |
| Balance, end of period | $ 7,874 | $ 5,890 |
| Non Cash Transactions: | ||
| Capital leases | $ 32 | $ 3,147 |
| BlueLinx Holdings Inc. | ||||
| Adjusted Pre-Tax Loss | ||||
| in thousands, except for per share amounts | ||||
| Quarters Ended | Nine Months Ended | |||
| September 29, 2012 | October 1, 2011 | September 29, 2012 | October 1, 2011 | |
| (unaudited) | (unaudited) | (unaudited) | (unaudited) | |
| Pretax income (loss) | $ 2,991 | $ (6,114) | $ (11,332) | $ (28,176) |
| Gain from sale of certain properties | (9,151) | -- | (9,680) | (6,939) |
| Gain on modification of lease agreement | -- | (1,971) | -- | (1,971) |
| Gain from property insurance settlement | -- | (1,230) | (476) | (1,230) |
| Severance related costs | -- | 1,139 | -- | 1,346 |
| Adjusted pretax loss before the effect of special interest items | (6,160) | (8,176) | (21,488) | (36,970) |
| Changes associated with the ineffective interest rate swap | -- | -- | -- | (1,751) |
| Adjusted pretax loss | (6,160) | (8,176) | (21,488) | (38,721) |
| Adjusted benefit from income taxes | (2,454) | (3,062) | (7,969) | (14,807) |
| Adjusted net loss | $ (3,706) | $ (5,114) | $ (13,519) | $ (23,914) |
| Basic weighted average shares | 60,099 | 51,183 | 60,067 | 37,696 |
| Adjusted basic net loss per share applicable to common shares | $ (0.06) | $ (0.10) | $ (0.23) | $ (0.63) |
| Diluted weighted average shares | 60,099 | 51,183 | 60,067 | 37,696 |
| Adjusted diluted net loss per share applicable to common shares | $ (0.06) | $ (0.10) | $ (0.23) | $ (0.63) |
| BlueLinx Holdings Inc. | ||||
| Reconciliation of GAAP Net Income (Loss) to Adjusted Net Loss | ||||
| in thousands | ||||
| Quarters Ended | Nine Months Ended | |||
| September 29, 2012 | October 1, 2011 | September 29, 2012 | October 1, 2011 | |
| (unaudited) | (unaudited) | (unaudited) | (unaudited) | |
| GAAP net income (loss) | $ 3,068 | $ (6,208) | $ (11,657) | $ (28,315) |
| Gain from sale of certain properties | (9,151) | -- | (9,680) | (6,939) |
| Gain on modification of lease agreement | -- | (1,971) | -- | (1,971) |
| Gain from property insurance settlement | -- | (1,230) | (476) | (1,230) |
| Severance related costs | -- | 1,139 | -- | 1,346 |
| Changes associated with the ineffective interest rate swap | -- | -- | -- | (1,751) |
| Tax effect of selected charges | 3,532 | 796 | 3,920 | 4,072 |
| Valuation allowance | (1,155) | 2,360 | 4,374 | 10,874 |
| Adjusted net loss | $ (3,706) | $ (5,114) | $ (13,519) | $ (23,914) |
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